Seanad debates

Tuesday, 5 October 2021

Nithe i dtosach suíonna - Commencement Matters

Aviation Industry

2:30 pm

Photo of Jerry ButtimerJerry Buttimer (Fine Gael)
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I thank the Cathaoirleach for selecting my matter. The Minister of State is welcome to the House. As we emerge into a post-Covid-19 world, a traffic reinstatement support scheme for our airports is important, as is aviation recovery. Route development, reinstatement and retention is what I am referring to and, in particular, the need for financial supports to be given to our airports and to be used to attract new business.

I make no apology for being an advocate for not only Cork Airport, but all our airports. Prior to Covid, Cork was the second fastest growing airport in the country. It was growing faster than Dublin Airport, as the passenger data will show.

The Minister of State is from the west of and knows that connectivity is important. It is important for the external aviation sector. It is pivotal to our tourism industry and to balanced regional development. Our national broadband plan is being unfurled, which highlights the importance of connectivity to our regions.

As travel and transport return to normal, it is important that the Government sets out its stall to implement measures to restore confidence in air travel to encourage people to come into Ireland. Central to that is that we show we are open for business and that potential visitors can visit Ireland with confidence. Linked to that, we should, in the forthcoming budget and on an ongoing basis, offer financial assistance in the form of a rebate of airport charges. I acknowledge that airport relief in continuing at local level. We also need route incentivisation schemes and regional airport supports. In fairness, the industry will recognise the supports that the Government has given. All of us in this House and the Lower House should acknowledge that the Government has been quick to support our aviation sector through a multiplicity of schemes. I very much welcome that. The aviation sector supports what the Minister of State has been doing. It is important that the capital expenditure and operating expenses supports for the regional airports in Cork and Shannon continue.

The reinstatement support scheme for next year is important. Aer Lingus has yet to announce its winter schedule, which runs from October to April. Aer Lingus is our country's primary carrier. In the context of the plan for the future, it is important that we give certainty.

I also raise the issue of Emerald Airlines. The Minister of State has been involved in discussions with the company. It is important for that company to get off to a good start. I say that in the context of Cork Airport, from where Emerald Airlines has a regional franchise to parts of the provincial UK. I wish the company well.We need to give them supports and put in place that financial truncated support to ensure reinstatement of routes and route retention, as we saw last week with Ryanair and Cork Airport and as we saw with Shannon Airport. I appreciate that the Minister of State, Deputy Hildegarde Naughton, is doing her level best but it is important in the context of what we are doing as a country around connectivity and route development, that Government continues to support our aviation sector. This is about Ireland being open for business. Our aviation sector is critical to tourism and jobs.

I look forward to the Minister of State's response and thank her for the work she has been doing so far in her tenure.

Photo of Mark DalyMark Daly (Fianna Fail)
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I thank the Minister of State for coming in this afternoon to answer this question.

Photo of Hildegarde NaughtonHildegarde Naughton (Galway West, Fine Gael)
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I thank Senator Buttimer for giving me the opportunity to make a statement with regard to plans for an aviation recovery strategy and the commitment of the Government to support our airports. We are all well aware that the aviation sector plays a critical role in our economy, as Senator Buttimer said, as a direct employer, an indirect employer and a driving force for tourism and business, including foreign direct investment. Government policies have consistently recognised and supported this contribution. Our national aviation strategy over the years has sought to enhance Ireland's connectivity by ensuring safe, secure and competitive access that is responsive to the needs of business, tourism and consumers.

Ministers have engaged extensively with all aviation stakeholders, including the aviation recovery task force, the National Civil Aviation Development Forum and the aviation sub-group of the Labour Economic Employment Forum. It is clear from this engagement that the single most important factor for Irish aviation was the earliest and widest possible reopening of international travel, subject to public health considerations. The Government has agreed a range of measures and has allowed the resumption of non-essential international travel since 19 July. Central to this was the substantial work undertaken to introduce the enhanced passenger locator form and the EU digital Covid certificate. Under these arrangements we have seen a very welcome recovery in passenger numbers, up nearly 300% since 19 July at our State airports by mid-September.

While passenger numbers at the airports are still only running at between 50% and 70% of pre-pandemic levels, we are seeing positive trends. In that regard, I very much welcome the news that Ryanair will reopen its Cork Airport base from December, the return of Aer Lingus to Shannon Airport on the Heathrow route and restoration of its Knock airport service to London in December. The announcement of the relaxation of the US travel rules for European travellers from November is also welcome and we can look forward to an increase in transatlantic traffic over the coming months. The announced return of both American Airlines and United Airlines to Shannon Airport is a positive development, particularly as transatlantic connectivity is key to any commercial activities in the mid-west region, including tourism and the hospitality sector.

An integral part of our current aviation policy is international connectivity which is fundamentally about access to markets and regions and it plays a key role in creating economic value. The importance the Government places on regional accessibility, development and connectivity is evident in the supports provided to our regional airports, through the Exchequer funded regional airports programme which also supports our public service obligation, PSO, service between Donegal and Dublin.

It is important to acknowledge what Government has done in regard to supports. There has been a comprehensive suite of measures to support businesses, including the aviation sector, such as the employment wage subsidy scheme and the waiving of commercial rates, which are the cornerstone of the Government’s unprecedented intervention to assist business. It is estimated that our airports and airlines have received more than €300 million under these support measures in addition to the aviation specific support package of €80 million, which was announced last November. This package represented a fourfold increase in the level of support normally provided to our airports under the regional airports programme, in addition to the €21 million made available to our regional airports under the programme for 2021, and for the first time Cork and Shannon Airports also received funding.

Having taken into account the recommendations of the task force for aviation recovery and in light of the impact of Covid-19 on Cork and Shannon Airports, the regional state airports programme for 2021 provided capital and operational supports of €32 million for these airports.

As Members will be aware, the European Commission approved under EU state aid rules a €26 million Covid-19 supplementary supports scheme to compensate airport operators for the damage caused by Covid-19.

Of this funding, the State airports were provided with €20 million, with the remaining €6 million allocated to the smaller regional airports of Ireland West Airport Knock and Donegal and Kerry Airports. I can advise the House that my Department is currently assessing the possible need and considering options for further targeted supports for aviation with a view to aiding the restoration of lost air connectivity and competitiveness.

Photo of Jerry ButtimerJerry Buttimer (Fine Gael)
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I thank the Minister of State for her response, and in particular, the last line of her response in which she stated that her Department is open and assessing options for further supports. At the launch in Cork of the Ryanair base and new flights, Mr. Eddie Wilson remarked that Dublin Airport could see a fall in Ryanair passenger numbers by 35% next summer, as the DAA traffic recovery scheme does not have the required funding from Government to incentivise air traffic recovery.

The important point is that we must all work towards air traffic recovery. I wish to compliment those in the DAA under Mr. Dalton Philips, the CEO of Cork Airport, Mr. Niall McCarthy, and all who work in our aviation sector. I also wish to compliment the Minister of State. This is an important piece of work that Government must continue to support. I appreciate the work that is being done, and has been done, by Government, the interventions made and the financial support provided. However, it is now critical. The Cathaoirleach is a fan of the USA. As we open up transatlantic travel, it is important that Ryanair, which has done its bit in Europe, is matched by Aer Lingus in transatlantic flights. I hope that we can see transatlantic flights departing from Cork. We have seen the paradigm shift with transatlantic flights departing from Cork with Norwegian Air. We must also ensure that Shannon gets its fair share. It is important for our island nation that our air traffic gets back to normal and to pre-Covid levels and that we support it. I know the Minister of State will do that. I thank her for being here today.

Photo of Hildegarde NaughtonHildegarde Naughton (Galway West, Fine Gael)
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I thank the Senator for his comments. We acknowledge that aviation is a global industry. It has weathered a crisis and demonstrated great resilience. It is important to state that much of the recovery in the passenger numbers has been driven by our successful vaccination programme and those of our European neighbours. At this stage, approximately 90% of our incoming passengers completing the electronic passenger locator form are fully vaccinated. Ireland's reputation as a safe destination is also enhanced by our impressive vaccination figures and our position at the top of the Bloomberg Covid resilience ranking.

In relation to our national aviation policy, we started work on that but it was paused in 2020 as a result of Covid-19 so that we could deal with the crisis in aviation. I wish to inform Senators that work on a revised national aviation policy will begin again in the coming months. A key part of that policy will be the development of a comprehensive public consultation process, as well as close engagement with the aviation industry through the structures of the national civil aviation development forum. The programme for Government acknowledges the value of aviation in supporting economic development, international connectivity and tourism via our airports, while also acknowledging our commitment to support EU and international action to reduce aviation emissions. It is a priority for Government to continue to build on the recovery in the aviation sector. I do not want pre-empt or indeed, pre-announce, budgetary measures that may provide additional supports for the sector for 2022, but I can assure the House of the Government's continued support for the aviation sector and our airports as we recover from this unprecedented crisis in the sector.